Read the information below about a city bus service. The local government pays a subsidy because some routes are used mainly by older residents and students...

Assessment: Economics 9214 | Paper 1 Mock 01 | Written Paper 1 Subject: Economics - 9214

Question 1 Report

Read the information below about a city bus service. The local government pays a subsidy because some routes are used mainly by older residents and students, although the routes make a loss.
(a) State one possible reason why the government may allocate funds to these bus routes. [2]

Answer Details

(a) The government may subsidise the loss-making routes to give people without cars access to work, education or healthcare. This can improve equality and social welfare.

Alternatively, funding bus routes may reduce traffic congestion or pollution. These are external benefits because other people, not only bus passengers, can benefit. Either explained chain gains full credit. [2]

Download The App On Google Playstore

Everything you need to excel in your exams

Green Bridge CBT Mobile App
Personalized AI Learning Chat Assistant
200,000+ Exam Questions Across IGCSE, JAMB, WAEC & NECO
Over 3,900 Lesson Notes
Offline Support - Learn Anytime, Anywhere
Green Bridge Timetable
Literature Summaries & Potential Questions
Track Your Performance & Progress
In-depth Explanations for Comprehensive Learning